2 Best Performing & High Rated Multi Cap Funds To Invest For 5 Years In 2021

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oi-Vipul Das

| Updated: Sunday, October 10, 2021, 17:45 [IST]

Among equity mutual fund categories Multi Cap mutual funds have witnessed a strong inflow in the month of September 2021. According to the data of the Association of Mutual Funds in India (AMFI) multi cap funds have achieved the highest positive inflow of Rs 3,569.45 Cr and as of 30th September 2021 and the number of portfolios created under the fund category was 18,35,717. The fund has also achieved a massive Asset Under Management (AUM) and Average Net Assets Under Management of Rs 31,442.41 Cr and Rs 27,838.25 Cr as of 30th September 2021.

Why to invest in multi cap funds now?

We have only seen a strong rally in multi cap funds because these funds allocate their assets between large, mid-sized, and small stocks based on market conditions, and in an environment where the Indian benchmark indices Sensex and Nifty 50 are at all-time highs, these funds are the most popular among equity investors due to their asset allocation strategy.

Multi cap funds are less risky than pure large or mid-cap funds, and they might be a smart choice for individuals with a low-risk tolerance and have a personal financial objective of 5 years. Multicap funds must invest at least 75 percent of their total assets in equities, with a minimum allocation of 25 percent each in large cap, mid cap, and small size companies, according to SEBI.

This strategy demonstrates how to diversify across various market capitalizations when the market is soaring at a record high of 60,059.06 points. So here are the two highly rated multi-cap funds that you can consider to invest in the year 2021 for better diversification of your portfolio.

Quant Active Fund Direct-Growth

This Multi Cap mutual fund scheme has been in existence for the past 20 years. The fund has an expense ratio of 0.5 percent, which is lower than most other funds in the same category and it holds 96.80 percent of its assets in equity and the rest in cash. According to Value Research, Quant Active Fund Direct-Growth returns over the last year have been 85.70 percent, with an average annual return of 22.25 percent since its debut.

The fund has a major equity allocation across the Financial, FMCG, Metals, Construction, Healthcare sectors. Vedanta Ltd., State Bank of India, Reliance Industries Ltd., Fortis Healthcare (India) Ltd., and ITC Ltd. are the fund’s top five holdings. As of 30th June 2021, the fund has been rated “No 1” by CRISIL which demonstrates its excellent performance across bear and bull market phases.

As of 8th October 2021, Quant Active Fund Direct-Growth has a Net Asset Value (NAV) of Rs 429.78 and the Asset Under Management (AUM) of the fund is 1,050.80 Cr. The fund has no exit load and one can start SIP with a minimum amount of Rs 1000.

HDFC Retirement Savings Fund Equity Plan Direct-Growt

HDFC Mutual Fund established this Multi Cap mutual fund scheme in the year 2016 and it has now been in operation for 5 years. The fund’s expense ratio is 0.96 percent, which is higher than the expense ratio charged by most other Multi Cap funds. This fund’s assets are made up of 92.30 percent equity, 6.7 percent cash, and 1% debt.

According to Value Research, HDFC Retirement Savings Fund Equity Plan Direct-Growth returns over the last year have been 72.32 percent, with an average annual return of 22.93 percent since its commencement. Financial, Services, Technology, Chemicals, and Engineering are the fund’s top equity allocations.

The fund has been rated a 4-star ranking by Value Research which is a pretty good indicator of the fund’s past performance. HDFC Retirement Savings Fund Equity Plan Direct-Growth has a Net Asset Value (NAV) of Rs 31.92 and an Asset Under Management (AUM) of 1,921.51 Cr as of October 8, 2021. With a minimum monthly investment of Rs 500, one can begin a SIP in this fund.

2 Best Multi Cap Funds In 2021

Based on the higher ratings only here we have selected two multi-cap funds for you which you can consider investing in in 2021.

Funds 1 mth returns 6 mth returns 1 Yr returns 3 Yr returns 5 Yr returns
Quant Active Fund Direct-Growth 4.15% 30.98% 85.70% 36.32% 24.49%
HDFC Retirement Savings Fund Equity Plan Direct-Growth 3.89% 30.12% 72.32% 25.64% 18.52%
Source: Groww

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